TaxTMI 
TaxTMI 
2026 (10) TMI 112
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....ted 26.09.2019 confirmed the demand with penalty. Aggrieved by the said order, an appeal was filed. Commissioner (Appeals) as per the impugned order dated 08.01.2021, rejected the appeal. Aggrieved by the said order, present appeal is filed. 3. When the appeal came up for hearing, Learned Counsel for the appellant drew our attention to the finding in the impugned order and submits that the issue considered by the Adjudicating Authority is as to whether the appellant is liable to pay an amount equal to 5% or 6% on the value of the exempted goods cleared by them for non-maintenance of separate accounts in respect of the cenvat credit availed on inputs and input services which are used for manufacture of dutiable and exempted goods or not on the goods cleared to expansion projects in terms of Sl. No. 91C of Notification No. 06/2006-CE dated 01.03.2006. 4. Learned Counsel for the appellant submits that the appellant has cleared the excisable goods in terms of Sl. No. 91C of Notification No.06/2006-CE dated 01.03.2006 availing the benefit of exemption from payment of central excise duty thereby the goods were covered within the meaning of exempted goods. Further, as per the show c....
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.... the public interest so to do, hereby exempts the goods of the description specified in column (3) of the Table below or column (3) of the said Table read with the relevant List appended hereto, as the case may be, and falling within the Chapter, heading or sub-heading of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975) as are specified in the corresponding entry in column (2) of the said Table, when imported into India,- (a) from so much of the duty of customs leviable thereon under the said First Schedule as is in excess of the amount calculated at the rate specified in the corresponding entry in column (4) of the said Table; (b) from so much of the additional duty leviable thereon under sub-section (1) of section 3 of the said Customs Tariff Act, as is in excess of the rate specified in the corresponding entry in column (5) of the said Table, subject to any of the conditions, specified in the Annexure to this notification, the condition No. of which is mentioned in the corresponding entry in column (6) of the said Table:" 6. Further, said notification was superseded vide Notification No. 12/2012-Cus dated 17.03.2012 by maintaining same exempti....
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....pellant submits that the impugned order is legally untenable in as much as the supplies made towards expansion of the existing power project is clearly covered under Rule 6(3) (i) of Cenvat Credit Rules, 2004 and the above referred clause specifically provides that operation of section 6(1) to 6(4) would not be applicable in case goods are supplied for expansion of the mega power project. In this regard, Learned Counsel drew our attention to the certificate issued by M/s. Torrent Power Limited which clearly certifies that the goods to be supplied for the mega power project are under the procedure of international competitive bidding. Certificate issued by Joint Secretary to Government of India to M/s. Torrent Power Ltd., for claiming exemption under Central Excise and Customs Notifications for expansion of Mega Power Project as per Sl.No.339 of Excise Notification No.12/2012-CE and Sl.No.508 of Customs Notification No.12/2012-Cus. & 21/2002-cus (Sl.No.400A) of the relevant clause under Rule 6(6) is reproduced below: (vii) all goods which are exempt from the duties of customs leviable under the First Schedule to the Customs Tariff Act, 1975 (51 of 1975) and the additional d....
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....on that the goods have to be exempt from whole of customs duty but what is required is exemption from duty of customs. The relevant extracts of the clause is reproduced below for convenience (vii) all goods which are exempt from the duties of customs leviable under the First Schedule to the Customs Tariff Act, 1975 (51 of 1975) and the additional duty leviable under sub-section (1) of section 3 of the said Customs Tariff Act when imported into India 11. In this context, Learned Counsel submits that in the present case, there is no dispute that the impugned supplies are for expansion of mega power project and it is covered under notification no. 21/2002Cus (Sl.No.400A) / Sl. No. 508 of Notification No. 12/2012-Cus dated 17.3.2012 which provides for partial exemption from basic customs duty of 2.5% (tariff rate of duty is 10%) and full exemption from additional customs duty. The relevant extracts of the notification is reproduced below: Sl. No. Chapter Heading Description of goods Standard rate Additional duty rate Condition No. (1) (2) (3) (4) (5) (6) 508 9801 Goods required for the expansion of any existing Mega Power project....
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....e provisions of Rule 6(1) to 6(4). On this ground also, the impugned order to be set aside as it is bad in law. 14. Learned Counsel further submits that allegation that the expansion project is not covered by Cenvat Credit Rules, 2004 amounts to interpretation of Rule something which is non-existing. No finding can be given that there is no mention in the Rule that the said rules would apply only when the entire duty of customs is extended. Further, as per the Customs Notification, entire additional duty is exempted while importing the goods and these as per the goods manufactured in India. Learned Counsel also submits that the contents in the Impugned order are legally untenable in as much as the department is trying to bring in or add certain words which are not in existent in the rules for the purpose of denying the benefit the Rule 6(6)(vii). Appellant submits that the rule 6(6)(vii), nether provide that the benefit of Rule 6(6) would be available only for clearances to setting up of mega power project nor it says that the supplies to expansion projects would not be eligible to non-reversal benefit. Appellant submits that when the conditions under the rules are clear and una....
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....03.2006. From this, it is evident that if the goods cleared by the appellant are covered under Sl. No. (vii) of Rule 6(6) of CCR, 2004, then they need not maintain separate accounts and pay the amount as applicable. However, on perusal of Notification No. 12/2012Customs dated 1.3.2002 which prescribes the effective rate of customs duty and additional duty on goods imported into India it is seen that the goods required for the expansion of any existing Mega Power Project so certified by an officer not below the rank of a joint secretary to the Government of India in the ministry of Power attract customs duty rate of 2.5%. In the instant case, it is seen that the goods cleared by the appellant to the expansion project are subjected to Customs duties at 2.5% if they are imported into India. As such, I find that if the impugned goods when imported into India, are not exempted from payment of Customs duties. Hence, these goods cannot be treated as goods that are exempt from the duties of customs and additional duties of customs when imported into India. Accordingly, it is established that the clearance of impugned goods made by the appellant are not covered under Ruie 6(6)(vii) of Cenva....